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People love to ask me, “how’s the market?” Some want to know; others are looking for a common topic we can discuss. It’s a softball question.
Then there are the people declaring a position and looking to engage. “That bubble, it’s burst.” Slow down partner…. there’s more to the story.
Here’s what I know:
- Inflation is impacting us all…rising at the fastest pace in 40 years. Gas is way up, as is food. (I worry about people affording to heat their homes this coming winter.)
- The Federal Reserve lifted interest rates by 0.75% on June 15 to slow the economy.
- Mortgage rates are kissing 6%. Some say they will keep marching up, others think they will drop….and not back to the 2s or 3s.
- Real estate inventory in MA has just exceeded last year’s inventory and is still historically low.
Here’s what I predict/recommend:
- The real estate market is dampening, not stopping. We’ll see less of the “house on the market at 2:00, with 10 offers submitted by 2:15” behaviors. Sellers need to be realistic in their pricing. The house selling down the street for a bazillion dollars sold at a time when mortgage rates were very low. $800K buyers are now looking at $600K homes. First time buyers are struggling with affordability.
- Getting an offer or two is fine. This means don’t be disappointed if you don’t get 35 offers. It only takes one.
- Home inspections will reappear! I like having home inspections…it makes sure buyers know what they are buying and leads to less buyer’s remorse.
- Focus less on a mortgage percentage and more on the payment. If rates go up, your payment is known. If they go down, you can refinance. Always make sure you can afford the payment in any situation.
Bottom line, this sputtering in the real estate markets are predicting a return to a more balanced and less intense real estate market.
Enjoy and stay sanitized!
Here is free app for your phone/tablet tied directly to the MLS https://www.homesnap.com/Gary-Kelley
Gary is heard on WCRN AM 830 discussing “All Things Real Estate.”
If you need advice on selling your home or buying a new one, give us a call 508-733-6005.
